Weekly review

The FTSE 100 ended the short post-Easter week down 94.7 points, closing at 7,521.68 on Friday.

Equity view

B&M European Value Retail chief executive Simon Arora on Friday said he planned to retire in 12 months after 17 years at the helm of the variety goods chain. Arora bought the group in December 2004 with his brother Bobby and expanded its estate to more than 1,100 stores from 21.

Real estate investment trust LXI REIT revealed on Friday that it had made a number of transactions, disposing of one property and acquiring another two. LXI REIT disposed of a Saffron Walden property let to Premier Inn, B&M, Pure Gym, Pets at Home, and Costa, for £19.33m, which represents a 19% internal rate of return per annum.

Pantheon International updated the market on its performance on Friday, reporting an unaudited net asset value of 434.2p per share as at 31 March - up 16.6p, or 4%, from 28 February. The FTSE 250 private equity investor said that in March, valuation gains were 12.8p, investment income added 0.3p, foreign exchange movements were a positive 0.9p and share buybacks added 3.2p, while expenses and taxes took away 0.6p.

Ukraine-focussed mining firm Ferrexpo said on Friday that it had been forced to delay a decision as to whether it should pay a dividend or not following Russia's invasion of the country. Ferrexpo, which also stated it will pause projects not expected to deliver near-term growth, said all its operations in Ukraine were away from the main conflict zones but highlighted that the war, which began on 24 February, had created many operational and logistical challenges.

Ventilation systems manufacturer Titon Holdings revealed on Friday that Alexandra French had been tapped to take over as chief executive officer. French, who will take up the position of CEO and join the board on 3 May, comes to Titon from Johnson Matthey, where she spent more than 20 years working in a variety of commercial, operational, technical, quality, and sales and marketing roles.

Pest control group Rentokil Initial said on Thursday that 2022 had started well, with strong momentum from the prior year continuing into Q1. Rentokil, which highlighted that it had seen progress across all business categories and regions, said ongoing revenue was up 1.8% at £721.6m, while organic growth, excluding disinfection, was 8.0% higher year-on-year.

Aerospace company Meggitt posted a 5% year-on-year jump in Q1 group revenues on Thursday, reflecting a positive trajectory in civil aerospace, as well as growth in energy. Meggitt said group civil order intake in the quarter was up 116%, principally due to civil recovery and a weak comparator in 2021, with original equipment up 54% and aftermarket up 176%, including a strong performance from braking systems across large, regional and business jets.

Anglo American lowered annual production guidance after a 10% fall in first-quarter output, reflecting Covid-related staff shortages, high rainfall in South Africa and Brazil, and issues at its metallurgical coal and iron ore operations. The company on Thursday forecast platinum group metals (PGM) production to 3.9 million - 4.3 million ounces from 4.1m-4.5m.

Real estate investment company Segro said on Thursday that it had made "a strong start to the year", with continued demand from a broad range of customers enabling it to capture further rental growth through rent reviews and the re-letting of space. Segro said total new headline rent signed during the period increased to £25.0m from £18.0m a year earlier, while pre-lets were flat year-on-year at £11.0m but uplifts from rent reviews and renewals almost doubled from £12.0m in 2021 to £23.0m twelve months later.

BHP lowered full-year copper and nickel production guidance as it battled Covid-related staff absenteeism and political unrest in Chile. Third-quarter copper production fell 6% year on year to around 370,000 tonnes, while nickel fell 8% to 18,700 tonnes.

Anglo-Australian mining giant Rio Tinto on Wednesday reported lower-than-expected iron ore shipments in the first quarter as it warned of inflationary risk, a resurgence of Covid lockdowns in China and the impact of a prolonged Russia-Ukraine war. Rio shipped 71.5m tonnes (Mt) of iron ore in the three months to March 31, compared with 77.8 Mt a year earlier and consensus estimates of 76 Mt.

Online betting and gaming firm 888 Holdings said on Wednesday that total revenues had fallen in the three months ended 31 March. 888 Holdings said total revenues had slid 18% year-on-year to £224.0m, with average monthly active users 8% lower when compared to the group's record result in the first quarter of 2021.

Wood Group chief executive Robin Watson on Wednesday said he was retiring as the company narrowed annual losses and forecast higher revenues for the coming year, but warned of a cash drag. The company said 2021 pre-tax losses came in at $80.6m compared with $148.6m a year earlier.

Building materials group CRH reported a positive start to the year on Wednesday, with group like-for-like sales up 13% in the first quarter and first-half sales, EBITDA and margin set to be ahead of the prior year. The company said sales growth and performance were supported by improved activity levels and the continued execution of its integrated solutions strategy.

Energy firm SSE has acquired Siemens Gamesa Renewable Energy's existing European renewable energy development platform for €580.0m. SSE said on Wednesday that the SGRE portfolio included roughly 3.9 gigawatts of onshore wind development projects, around half of which are located in Spain with the remainder across France, Italy, and Greece, with scope for up to 1.0GW of additional co-located solar development opportunities.

IT provider Kainos said on Tuesday that full-year revenues and adjusted profits were both expected to meet current consensus forecasts as trading continued to be "very strong", new and existing clients maintaining or increasing their levels of investment in digital solutions. Kainos stated that against a backdrop of "strong market demand in the UK", its digital services teams delivered "major transformation programmes" to new and existing clients across the public, commercial and healthcare sectors. While international engagements also grew in scale, with positive progress in both Europe and Canada.

JTC increased its dividend and was upbeat about the outlook as the asset manager reported a 24% increase in underlying annual profit. Underlying pretax profit rose to £24.9m in the year to the end of December from £20.1m a year earlier as underlying revenue increased 28% to £147.5m. Statutory pretax profit rose 147% to £27.8m.

WH Smith has suspended orders at its Funky Pigeon operation after the online card and gift retailer was hit by a cyber attack. The company said the attack affected Funky Pigeon's systems on 14 April and that it was investigating the incident with outside experts.

Drugmaker AstraZeneca said on Tuesday that its Enhertu candidate had been granted priority review in the US for patients with previously treated HER2-mutant metastatic non-small cell lung cancer. AstraZeneca said the US FDA's decision to review Enhertu, a HER2-directed antibody drug conjugate being jointly developed by AZN and Daiichi Sankyo, was based on pivotal DESTINY-Lung01 results showing the frug demonstrated a 54.9% tumour response rate.

Chill Brands has promoted its international brand director, Callum Sommerton, to chief executive, replacing the tobacco alternative products group's joint CEOs. Sommerton, who joined Chill in 2021, has been appointed to the board. He will take over running the company from Antonio Russo and Trevor Taylor. Russo has become chief commercial officer and Taylor has moved to be chief operating officer and will stay on the board.

Strategic Minerals updated the market on the Cobre magnetite operation in New Mexico on Friday, reporting that sales to the project’s largest client returned to “normal levels” in February and March. The AIM-traded firm said sales for both the March quarter and the year to 31 March totalled $0.7m and $2.5m, respectively, being impacted by weaker January sales.

Leisure operator XP Factory updated the market on new site openings on Friday, following its acquisition of the ‘Boom Battle Bar’ chain in November. The AIM-traded firm reported “significant” progress, completing the integration of Boom, expanding the UK footprint and further developing the site pipeline.

Clays bricks and concrete products manufacturer Ibstock said on Thursday its FY22 performance is set to be "modestly ahead" of its previous expectations after a strong start to the year. In an update for the first quarter, the group said it had performed ahead of its expectations, driven by stronger clay brick sales volumes and a resilient margin performance.

Gambling company Rank Group cut its full-year guidance on Thursday as it pointed to a softer performance in March and highlighted inflationary pressures. For the year to 30 June, the group now expects EBIT of between £47m and £55m, down from previous guidance of £55m to £65m. This takes into account third-quarter trends, notably softness in its UK venues towards the end of the quarter and continued inflationary costs.

Hikma Pharmaceuticals has received preliminary approval from the US Federal Trade Commission for the acquisition of sterile injectables company Custopharm Inc from Water Street Healthcare for up to $425m. The group said on Wednesday that it will now work towards closing the acquisition. It noted that the parties have obtained all regulatory approvals required to close the deal.

UK defence engineer Qinetiq lifted annual earnings guidance, as strong order intake boosted revenues. The company on Wednesday said it expected revenue growth on an organic basis of around 5% for the 2022 fiscal year, with underlying operating profit of at least £135m.

Pearson said its contract to manage Arizona State University's online study programme would end in June 2023 and said the effect on profit would be modest. The education publisher signed a deal with ASU in 2010 to provide learning resources and support for students. The partnership was billed as a groundbreaking move in taking university teaching online.

Cake Box said annual profit would meet market expectations after a strong second half to the year for the dessert maker. Revenue for the 10 months to the end of March, excluding store closures related to the Covid-19 crisis, rose by about 32% with franchisee sales up 12% like-for-like, Cake Box said. Business was boosted by online sales which rose 27% in 10 months and 41% during the year.

Economic news

Britons' outlook for the economy sank to its lowest level since the Great Financial Crisis, the results of a closely-followed survey revealed. Consultancy GfK's consumer confidence index for Britain slipped by seven points in April from the month before to reach a reading of -38.0.

Economic activity in the UK slowed markedly in April amid worsening inflation, not least record rises in firms' costs, and a gloomier outlook, the results of a batch of closely-followed surveys showed. S&P Global's 'flash' composite Purchasing Managers' Index Composite Output Index fell from a March reading of 60.9 to 57.6 for April (consensus: 58.5).

UK retail sales fell by more than expected in March as surging inflation hit demand for food and petrol, according to official data released on Friday. Retail sales volumes fell by 1.4% last month compared with February, the Office for National Statistics said, worse than expectations for a 0.3% monthly drop.

Motorsport giant Sir Lewis Hamilton and tennis superstar Serena Williams have both pledged millions of pounds to a possible bid for Chelsea Football Club. According to Sky News, the two celebrity sports people had committed around £10m each to a bid being led by ex-British Airways and Liverpool FC chair Sir Martin Broughton.

Retail footfall rose in the lead up to Easter as consumers got a chunk of shopping ahead of the long weekend, according to retail experts Springboard. Footfall rose 15% week-on-week during the period from Monday to Thursday leading up to Easter, with a rise of 21.9% on Thursday and 27.3% in UK high streets.

International events

Eurozone businesses reported mixed pictures as the services sector reported an unexpected surge in growth, while manufacturing was hit by continuing supply chain constraints, according to a survey published on Friday. S&P Global's Flash Composite Purchasing Managers' Index, regarded as a gauge of overall economic health, rose to 55.8 in April from 54.9 in March, beating expectations of a fall.

Factory activity in the US mid-Atlantic region slowed in April amid faster price gains, the results of a closely-followed survey showed. The Federal Reserve Bank of Philadelphia's regional manufacturing gauge fell from a reading of 27.4 for March to 17.6 in April.

First time jobless claims in the US held near their cycle lows during the past week. According to the Department of Labor, in seasonally adjusted terms, filings for initial unemployment claims drifted lower by 2,000 over the week ending on 16 April to reach 184,000.

Eurozone industrial production rebounded in February, official data showed on Wednesday, fuelled by an increase in consumer goods. According to Eurostat, the European Union’s statistics office, seasonally-adjusted industrial production rose 0.7% month-on-month, and by 0.6% in the wider bloc. That compares to a fall of 0.7% in January in the Eurozone, and a 0.3% decline across the EU.

German producer prices surged at a record rate last month, official data showed on Wednesday, as the war in Ukraine started to weigh heavily. According to Destatis, Germany’s Federal Statistics Office, producer prices rose 30.9% in March year-on-year, the highest increase since records began in 1949, or by 4.9% on February 2022.

The war in Ukraine will have many effects that will reach far and wide, not least by adding to price pressures and worsening the already stiff policy challenges faced by countries, the world's financial watchdog said. In a blog post, the International Monetary Fund slashed its January forecasts for global gross domestic product growth to 3.6% for both 2022 and 2023, as commodity markets, trade and financial linkages amplified the war's ills.

US housing starts unexpectedly edged 0.3% higher to a seasonally adjusted annualised rate of 1.793m in March - the highest since June 2006. March's print, which beat market forecasts of 1.745m, came alongside an upwardly revised figure for February, which was raised to 1.788m from an initial of 1.769m.